Everyone's trying wearables, but no one has found the perfect combination -- yet.
Sarah Tew/CNET

Wearables: Everybody in the tech world is talking about them, but no one has quite nailed it -- yet.

The category, which includes everything from smart glasses that record video to watches that answer phone calls, is generating some of the biggest buzz in the tech industry, and for good reason. Wearables are a long way from overtaking smartphones, but the market is expected to grow at a fast pace over the next few years.

Perhaps no one has a better view of what's ahead in the wearables market than the companies supplying the critical components. CNET talked with top executives from ARM Holdings, Broadcom, Freescale, Intel, Mediatek, and Qualcomm -- which will supply the brains and wireless chips for these devices -- to find out their views on where wearables are going. Here are some of their thoughts:

The field is wide open So far, there's no clear winner running away with the market, though many are trying. Nike, Fitbit, and other fitness bands dominate about 90 percent of wearables sales, according to Accenture. But Sony, Pebble, and others have also built devices with more features, including notifications and the ability to snap photos and access apps. Samsung has tried to position itself as a leader in wearables with its smartwatch and a strong marketing campaign, but it's unclear just how well Gear is selling. Google, meanwhile, is going after smart eyewear with Glass.

What does that mean? Anyone could have a hit, even if it's not a big name like Samsung. There's also still plenty of opportunity for someone, like Apple, to come up with something amazing that blows everyone away. It's clear that no one has really yet come up with the magic combination that attracts the masses.

Fitness and health bands will remain king -- at least for a while
Health devices make up the vast majority of wearables sales today, and that's likely to continue. Other devices have to find a way to appeal to a specific consumer need before they really take off. Right now, many are too complicated to be useful.

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Even health-focused wearables will continue to evolve and add new features. New sensors will allow devices to detect various biometrics beyond what's possible today. For example, companies are working on noninvasive blood chemistry sensors that transmit a laser beam to measure glucose levels and other factors.

Expect a lot more new entrants
Making a fitness band or smartwatch isn't quite as complex -- or as pricey -- as building a smartphone or laptop. And the chip companies, who want to help grow the wearables market, are making it as easy as they can. Many have built reference designs that customers can take and rebrand as their own. They've also created things like electronics boards that have all the necessary components integrated together.

"Because it is inexpensive to put some of these products together, it does open the door for new companies," said ARM Holdings CEO Simon Segars.

Kickstarter has helped companies like Pebble start from scratch and focus on just one thing: Making a great wearable device. That's going to continue, but chipmakers predict companies focused on other areas also will jump into the market. That could be health care and medical device companies looking at devices like a glucose monitor. Traditional watchmakers could add a touch of "smart" to their products as well.

There will be more of an emphasis on aesthetics
The vast majority of smartwatches on the market, and to some extent even Google Glass, are bulky and look more like a piece of technology than a fashion item. That's going to change as companies focus more on design and making devices that are more discrete.

"They have to look like something you really want to wear before they get mass adoption," said Mike Bell, head of Intel's mobile business. "A problem they have is everything is a square touch screen. I'm pretty sure long term that's not what people are going to want to wear all the time."

Various companies displayed new wearables in early January at the Consumer Electronics Show in Las Vegas.
Sarah Tew/CNET

Companies have already taken some steps to make their devices more fashionable. For instance, Pebble and Martian showed watches at CES that look more like regular watches than smart devices. And Google has released versions of Glass with prescription lenses and frames based on popular, regular glasses styles.

Glasses and watches are a start
Look for completely different products to emerge. Health care is an area that could see a surge in wearables. We'll also see more wearables for pets, such as new activity and biometrics trackers, as well as toys.

There will also be other types of devices that extend the capabilities of the smartphone or allow for social interaction, like a ring that lights up when a loved one taps the other half of the matching pair.

Another big area is clothing. For instance, manufacturers are working on smart buttons that could change the color of a fabric when pushed or buttons and fabric that could measure UV exposure in sports equipment.

"This year we're hoping to see the beginning of the wearables market showing its diversity," said Robert Thompson, business development leader for Freescale's i.MX application processor line.

The "Internet of Things" will be a driver of wearables
The Internet of Things, where regular items such as refrigerators or washing machines have enough smarts to talk to each other, is another hot trend. So far, very few wearables connect with those products.

Samsung's Smart Home, unveiled at CES, lets users manage all their connected appliances and devices through a single application. It also works with the Galaxy Gear. We'll see many more examples like this over the coming years.

Devices won't need the smartphone to operate
Essentially all wearables need to connect to an even smarter device, like a smartphone, to function. Galaxy Gear, for instance, sends an alert when an e-mail arrives and lets you read a paragraph or so, but you have to go to your phone to actually read the entire note and respond. Many others operate in the same manner.

At some point, there will be smartwatches and other devices that will break free of that link.

"Smart devices, until they become untethered or do something interesting on their own, will be too complicated and not really fulfill the promise of what smart devices can do," Intel's Bell said. "These devices have to be standalone and do something great on their own to get mass adoption. Then if they can do something else once you pair it, that's fine."

Prices will drop
Early adopters always pay a premium for new products, and that goes double for new categories. Those sky-high levels will eventually come down. In addition, the sheer amount of new players coming into the wearables market will guarantee a low-cost option.

Of course, pricing will depend on the use of the product. If it has more functionally or can even operate on its own without a smartphone, it will cost much more than devices that rely on another smart gadget.

"We see it more as an accessory or companion device," said Mediatek Chief Marketing Officer Johan Lodenius. "Therefore, price points have to be very low, like $50 or less."

No matter how the market shapes up, the chipmakers agree on one key thing: wearables are almost certainly going to shake up our lives in the years to come.

About the author

Shara Tibken is a senior writer for CNET focused on Samsung and Apple. She previously wrote for Dow Jones Newswires and the Wall Street Journal. She's a native Midwesterner who still prefers "pop" over "soda."
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